Naira Holds Steady as Improved FX Liquidity Keeps Official Rate Below Parallel Market
The naira maintained relative stability on Tuesday, supported by improved liquidity in the formal Nigerian Foreign Exchange Market (NFEM), which kept the official rate stronger than prices quoted on the parallel market.
Data from the NFEM showed that the volume-weighted closing rate settled at ₦1,448.03 per US dollar on November 18, 2025—about ₦5.60 or 0.39% weaker than the previous session.
Meanwhile, parallel market trackers quoted higher rates, ranging between ₦1,455 and ₦1,460 per dollar. The spread of ₦7–₦12 reflects the continued premium placed on physical cash transactions by traders and bureaux de change operators.
Understanding the Rates
NFEM/NAFEM:
The NFEM—also listed as NAFEM or the I&E window—represents the official daily exchange rate determined by interbank and market trades. It serves as the primary benchmark for corporate and institutional currency transactions.
Parallel Market:
Informal retail cash rates, often published by platforms such as Abokiforex, reflect the on-the-spot demand for physical dollars. These typically trade above the NFEM rate.
Market Drivers
The currency’s stability comes as investors continue to respond to improved FX availability and reduced domestic interest rates following the Central Bank of Nigeria’s policy rate cut in September. Analysts attribute the naira’s steadier performance this quarter to a mix of central-bank interventions, increased foreign inflows and easing inflation.
Impact on Consumers and Businesses
Companies with foreign-currency obligations are expected to favour the NFEM for its lower official pricing, while individuals and small traders requiring physical cash dollars will continue to contend with the higher parallel market premium. Travellers and remittance recipients may also experience varying exchange outcomes depending on whether transactions pass through formal banking channels or informal cash markets.
